Q3 2024 Akamai Technologies Inc Earnings Call Transcript
Key Points
- Akamai Technologies Inc (AKAM) achieved a significant milestone with its total annual revenue run rate exceeding $4 billion and security revenue surpassing $2 billion.
- The company's compute revenue grew by 28% year over year, demonstrating strong momentum in this segment.
- Akamai Technologies Inc (AKAM) is leveraging generative AI to enhance its security solutions, providing a competitive edge in threat visibility and intelligence.
- The company signed several significant contracts in Q3, including a $70 million agreement with a major financial institution, showcasing strong customer interest in its security solutions.
- Akamai Technologies Inc (AKAM) continues to expand its cloud computing capabilities, with enterprise compute solutions on track to achieve an annualized revenue run rate of over $100 million by year-end.
- The delivery segment faced macroeconomic headwinds, resulting in a 16% year-over-year decline in revenue.
- Akamai Technologies Inc (AKAM) anticipates weaker than normal traffic trends persisting into Q4, impacting delivery revenue.
- The company took an $82 million restructuring charge in Q3, primarily due to workforce reduction and related severance costs.
- Despite strong growth in compute, the company has not yet reached scale, limiting the immediate impact on operating leverage.
- Akamai Technologies Inc (AKAM) is facing challenges in the delivery market due to consolidation and pricing pressures from competitors.
Good day, and welcome to the Akamai Technologies third-quarter 2024 earnings conference call. (Operator Instructions) Please note that today's event is being recorded.
I would now like to turn the conference over to Mr. Mark Stoutenberg, Head of Investor Relations. Please go ahead, sir.
Good afternoon, everyone, and thank you for joining Akamai's third-quarter 2024 earnings call. Speaking today will be Tom Leighton, Akamai's Chief Executive Officer; and Ed McGowan, Akamai's Chief Financial Officer.
Please note that today's comments include forward-looking statements, including statements regarding revenue and earnings guidance. These forward-looking statements are subject to certain risks and uncertainties and involve a number of factors that could cause actual results to differ materially from those expressed or implied by such statements. The factors include any impact from macroeconomic trends, the integration of any acquisitions and any impact from geopolitical developments.
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